Koch v. Aupperle

L oren W. Koch , appeLLee , v. ronaLd e. aupperLe and
M ary ann aupperLe , appeLLants , and L oWer
pLatte south naturaL resources
district, intervenor-appeLLee .
763 N.W.2d 415
Filed April 10, 2009. 	No. S-08-245.
1. Equity: Appeal and Error. On appeal from an equity action, an appellate court
tries factual questions de novo on the record and, as to questions of both fact and
law, is obligated to reach a conclusion independent of the conclusion reached by
the trial court.
2. Statutes: Appeal and Error. Statutory interpretation is a matter of law in con-
nection with which an appellate court has an obligation to reach an independent,
correct conclusion irrespective of the determination made by the court below.
3. Injunction: Damages. When damages result from a wrongfully granted injunc-
tion, the person who requested the injunction ought to pay all resultant damages.
4. Injunction: Damages: Attorney Fees. All reasonable damages may be recovered
by an enjoined party if the injunction was granted in error. Reasonable attorney
fees incurred in dissolving the bond may also be recovered.
5. Injunction: Bonds: Damages: Attorney Fees. Pursuant to Neb. Rev. Stat.
§§ 25-1067 and 25-1079 (Reissue 2008), if an injunction is wrongfully granted,
the party requesting the injunction is required to pay all damages and reasonable
attorney fees to the enjoined party and is not limited to the amount of the bond.
Appeal from the District Court for Cass County: randaLL
L. 	rehMeier, 	Judge. 	Reversed 	and 	remanded 	for 	further
proceedings.
Thomas E. Jeffers and Mathew T. Watson, of Crosby Guenzel,
L.L.P., for appellants.
Stephen D. Mossman, of Mattson, Ricketts, Davies, Stewart
& Calkins, for appellee.
heavican, 	c.J., 	Wright, 	connoLLy, 	gerrard, 	stephan,
MccorMacK, and M iLLer-L erMan, JJ.
heavican, C.J.
INTRODUCTION
Ronald E. Aupperle and Mary Ann Aupperle appeal the
decision of the Cass County District Court limiting their dam-
ages to the amount of the supersedeas bond that Loren W. Koch
had filed with the court when he sought an injunction against
560 	277 NEbRASKA REPORTS
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www.nebraska.gov/apps-courts-epub/
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the Aupperles. The district court originally granted Koch’s
request for an injunction to prevent the Aupperles from con-
structing a small dam and pond across an unnamed tributary
of Weeping Water Creek. This court reversed that decision
and remanded the cause “with directions to vacate the injunc-
tion, dismiss Koch’s verified complaint, and determine whether
the Aupperles and [the Lower Platte South Natural Resources
District] are entitled to recover damages or attorney fees as a
result of the injunction issued below.”1
The sole issue presented at this time is whether the Aupperles
are entitled to more than the amount of the supersedeas bond.
We reverse the decision of the district court and remand the
cause for proceedings consistent with this opinion.
FACTS
The pertinent facts are contained in our prior opinion regard-
ing this cause and need not be revisited in their entirety here.
In short, however, the Aupperles had planned to build a dam
across an unnamed tributary of Weeping Water Creek to create a
small pond on their property, with the cooperation of the Lower
Platte South Natural Resources District (LPSNRD). Koch, a
downstream user of the waters from the tributary, sought and
obtained an injunction to enjoin the construction and requested
that the Aupperles be required to include a device that would
allow water to pass through the dam.
Koch was required to post a bond under Neb. Rev. Stat.
§ 25-1067 (Reissue 2008). The district court set the bond at
$1,000. The Aupperles subsequently moved to increase that
amount under Neb. Rev. Stat. § 25-1073 (Reissue 2008). On
July 25, 2005, during the hearing on the motion to increase
the bond, the Aupperles argued that their building costs had
gone up due to the delay. Koch argued that there was insuf-
ficient evidence to increase the bond. Koch and the district
court both acknowledged that there were two exhibits already
in the record, and the Aupperles did not introduce any addi-
tional evidence. The district court stated that it would consider
1 Koch v. Aupperle, 274 Neb. 52, 70, 737 N.W.2d 869, 882 (2007).
KOCh v. AUPPERLE 	561
Cite as 277 Neb. 560

the request based on the evidence before it, and it denied the
request the next day.
Upon the Aupperles’ original appeal, this court held that
Koch was not entitled to injunctive relief and reversed the
judgment of the district court. The cause was remanded to
determine whether the Aupperles and LPSNRD were entitled
to damages or attorney fees. The district court cited Tracy v.
Capozzi,2 a Nevada case, in determining that the Aupperles
could not recover more than $1,000, the amount of the origi-
nal bond, unless they could show that Koch acted in bad faith.
After finding that Koch had not acted maliciously or in bad
faith in requesting the injunction, the district court limited
recovery to the amount of the bond.
In its order, the district court stated that the Aupperles had
clearly shown attorney fees and damages not less than $1,000.
The district court then awarded costs to the Aupperles and
LPSNRD, to be paid by Koch out of the bond. The Aupperles
brought this appeal, contending that they were due the full
amount of their damages and attorney fees under Neb. Rev.
Stat. § 25-1079 (Reissue 2008). LPSNRD did not appeal from
the district court’s decision.
ASSIGNMENT OF ERROR
The Aupperles assign that the district court erred when it
determined that their recovery of damages and attorney fees
was limited to the amount of the supersedeas bond deposited
with the court.
STANDARD OF REVIEW
[1] On appeal from an equity action, an appellate court tries
factual questions de novo on the record and, as to questions of
both fact and law, is obligated to reach a conclusion indepen-
dent of the conclusion reached by the trial court.3
[2] Statutory interpretation is a matter of law in connection
with which an appellate court has an obligation to reach an
2 Tracy v. Capozzi, 98 Nev. 120, 642 P.2d 591 (1982).
3 Koch, supra note 1.
562 	277 NEbRASKA REPORTS

independent, correct conclusion irrespective of the determina-
tion made by the court below.4
ANALYSIS
At issue in this case is whether an enjoined party may
recover more than the amount of the supersedeas bond should
an injunction later be dissolved. Section 25-1067 states that
a party cannot obtain an injunction unless the requesting
party gives sufficient sureties “to secure to the party enjoined
the damages he may sustain, if it be finally decided that the
injunction ought not to be granted.” Section 25-1079 provides
for payment of damages out of the supersedeas bond, stating
as follows:
Such supersedeas bond shall be executed on or before
twenty days from the time of the order dissolving or
modifying such injunction, shall be signed by one or
more sufficient sureties to be approved by the clerk of
the court, and shall be conditioned that the party or
parties who obtained such injunction shall pay to the
defendant, or defendants, all damages, which he or
they shall sustain by reason of said injunction, if it be
finally decided that such injunction ought not to have
been granted.
This court has not yet addressed whether a party may recover
more than the amount of the supersedeas bond.
In its order, the district court noted that a majority of states
limit recovery to the amount of a bond, if the temporary injunc-
tion is wrongfully granted.5 Tracy, cited by the district court,
outlines the reasoning of the majority:
[W]e find the majority view more compatible with public
policy encouraging ready access to our courts. On bal-
ance, we find this public policy principle outweighs our
concern for defendants facing inadequate bonds at the ter-
mination of a wrongful restraint. We must zealously pro-
tect the good faith pursuit of legal and equitable remedies
4 Robertson v. School Dist. No. 17, 252 Neb. 103, 560 N.W.2d 469 (1997).
5 See, 42 Am. Jur. 2d Injunctions § 357 (2000); Annot., 30 A.L.R.4th 273
(1984).
KOCh v. AUPPERLE 	563
Cite as 277 Neb. 560

from the deterrent certain to be posed by unknown liabil-
ity for mistake.6
Thus, the majority view holds that ready access to the courts
outweighs concern for the damages a wrongfully enjoined
party may sustain. The Tracy court also points out that an
enjoined party who feels that the bond is inadequate may move
the court for an increase, something that is true under our stat-
utes as well.7
[3] Conversely, the minority view holds that when damages
result from a wrongfully granted injunction, the person who
requested the injunction ought to pay all resultant damages.8
This view has a commonsense appeal, as noted by the court
in Tracy, because it places responsibility for damages on the
party causing them, and it places the risk on the party request-
ing the injunction.9
[4] The Aupperles urge us to adopt the minority view, con-
tending that § 25-1079 requires that Koch pay “all damages”
sustained from the grant of the injunction, an issue that the dis-
trict court did not address. The Aupperles point out that other
states have required those who obtained a wrongful injunction
to pay all damages when there is a statute that conditions an
injunction with payment of all damages.10 While we note that
there are states which have statutory language mirroring ours
that side with the majority,11 we find the reasoning of the
minority of states more persuasive when paired with our own
statutes. Indeed, we find our statutory language compels us to
join the minority of states, as § 25-1079 clearly states that the
party who “obtained such injunction shall pay . . . all damages,
which he or they shall sustain by reason of said injunction.” We
therefore find that all reasonable damages may be recovered
6 Tracy, supra note 2, 98 Nev. at 125, 642 P.2d at 595.
7 See, § 25-1073; Tracy, supra note 2.
8 See Tracy, supra note 2.
9 See id.
10 Corpus Christi Gas Co. v. City of Corpus Christi, 46 F.2d 962 (5th Cir.
1931); Houghton et al. v. Grimes et al., 100 Vt. 99, 151 A. 642 (1930).
11 See, Petrol Properties v. Stewart Title Co., 225 S.W.3d 448 (Mo. App.
2007); DeSantis v. Wackenhut Corp., 793 S.W.2d 670 (Tex. 1990).
564 	277 NEbRASKA REPORTS

by an enjoined party if the injunction was granted in error.
Reasonable attorney fees incurred in dissolving the bond may
also be recovered.12
We note that the Aupperles exhausted their statutory reme-
dies by moving for an increase in the bond. Section 25-1073
allows a restrained party to move the court for additional secu-
rity, “and if it appears that the surety in the undertaking has
removed from the state or is insufficient,” the court can either
vacate the injunction or order an increase in the bond. In this
case, the Aupperles requested an increase in the amount of the
bond, and it was denied.13 We find that equity, as well as our
statutory language and policies, requires a party requesting an
injunction to pay for any damages caused by the injunction, as
well as reasonable attorney fees.
CONCLUSION
[5] Pursuant to §§ 25-1067 and 25-1079, if an injunction
is wrongfully granted, the party requesting the injunction is
required to pay all damages and reasonable attorney fees to the
enjoined party and is not limited to the amount of the bond. We
reverse the decision of the district court and remand the cause
for further proceedings consistent with this opinion.
reversed and reManded for
further proceedings.
12 Williams v. Hallgren, 149 Neb. 621, 31 N.W.2d 737 (1948).
13 See, e.g., Tracy, supra note 2.
in re interest of c.h., a chiLd under 18 years of age .
state of nebrasKa , appeLLee , v. c.h., appeLLant.
763 N.W.2d 708
Filed April 10, 2009. 	No. S-08-261.
1. Juvenile Courts: Appeal and Error. An appellate court reviews juvenile cases
de novo on the record and reaches its conclusions independently of the juvenile
court’s findings.
2. Motions to Suppress: Miranda Rights: Appeal and Error. In reviewing a
motion to suppress statements to determine whether an individual was “in
IN RE INTEREST OF C.h. 	565
Cite as 277 Neb. 565